Unions Fear Labor-Reform Bill May Weaken Their Influence

By Jun Kwan-woo, Korea Herald, 9 December 1996

Protesting the government’s new labor-reform bill, hundreds of union members belonging to the Korean Confederation of Trade Union march on a street in Ulsan, South Kyongsang Province, Saturday.

Since the government finalized its new labor-reform bill last Wednesday, labor organizations’ threats to stage a general strike have become increasingly intense. When trade unions first vowed to enter a nationwide strike calling for repeal of the bill, experts were divided fifty-fifty in forecasting whether or not the strike would take place.

But as time passed, some experts who had expected the unions’ threats to fizzle are apparently placing more weight on the possibility of a strike. The Korean Confederation of Trade Unions, an unauthorized but influential labor organization, announced unionized workers would go on a partial strike this Friday.

The confederation said in a news conference Saturday that the planned strike will last for four hours and is due to become a full-scale strike next Monday. On the day of the confederation’s partial strike, the Federation of Korean Trade Unions, the nation’s largest labor body, also plans to enter a one-hour strike.

If the two mammoth labor bodies grouping a total of some 1.8 million union members synchronize their strikes, the joint action would probably paralyze the nation’s business community. Why do labor unions desperately oppose the bill? Union leaders are frightened that the bill’s implementation will weaken—even emasculate—the influence of labor unions in future labor activities.

Although the bill granted unions the right to free organization in allowing multiple unions at a single work site, it required them to shoulder some hefty burdens to sustain that right. Trade unions are required to sustain themselves financially without assistance from the companies that have provided aid in accordance with previous practices.

One support granted by domestic companies which unions will no longer enjoy under the new labor bill is the issuance of payment to full-time union leaders. It has been a longstanding practice here for companies to pay wages to all union leaders who work exclusively for unionized workers.

Though management considered the payment inappropriate, they may have deemed the practice necessary to coax union leaders to go easy during labor bargaining. Some experts said that companies’ practice of paying those union leaders who did not perform regular company jobs at work sites worked out as management had expected.

But employers now oppose the payments since the multiple-union system will increase their financial burdens with the anticipated growth in the number of union leaders. The new labor bill regulates the bans on both companies’ payment for union leaders as well as on unions’ demands for payment, requiring unions to pay their leaders.

Some trade unions at large companies can afford to pay their leaders since they have a large number of union members who can raise funds payable to their leaders. But smaller trade unions are predicted to undergo severe financial difficulties. In effect, the majority of the nation’s trade unions will be unable to afford paying their leaders.

In a bid to help unions raise more funds, the bill lifts the ceiling on union members’ fees, which is currently limited to a maximum of two percent of the total wages. But it is inevitable that unions’ activities will shrink since unions will be forced to depend exclusively on the pocketbooks of individual union members.

What is even worse for trade unions is the fact that the new labor bill abolishes any legal requirement for companies to pay striking employees and allows employers to use substitute workers during strikes. Though labor authorities have advised management not to pay wages to striking workers, it has been an ill-kept secret that many companies have paid workers after strikes.

Some trade unions have frequently threatened to reenter a strike following a labor dispute unless the concerned company’s promised to pay wages not received during the strike. The new labor bill, however, renders illegal company offers of payment under any name as well as union demands for payment during strikes.

In comparison with its past supervision of the no-work- and-no-pay policy at work sites, the government chose a clearer legalization of the no pay policy during strikes. Since the bill fails to guarantee wages during or after strikes, unions are likely to hesitate more than ever before going on strike. Once unions decide upon strikes to pressure management, striking workers and their families will also have to endure wage losses during labor strife.

What appears to have particularly weakened unions’ influence in labor bargaining is the allowance of employers’ use of substitute workers. To protect the right to strike, the current labor-related laws strictly ban employers from replacing striking employees with temporary workers from the outside.

Permission to use substitute workers at strike-paralyzed work sites is a move in favor of employers which paves the way for them to run businesses smoothly regardless of walkouts. On the contrary, striking unions will not be wielding as much power since strikers can be replaced immediately under the bill.